US Stock Market Wave Counts Of Danger

GOLD

Gold was initially lower this week and reached a low of 1267.90, but by the end of the week it rallied to close at the 1288.80 level.

This week we adopted our alternate count that is suggesting that all of wave *i* ended at the 1349.80 high and that we are now falling in wave *ii*. Our retracement levels for wave *ii* are:

50% = 1258.50;

61.8% = 1236.90.

Although the 1267.90 low is short of our 50% retracement level the internal wave structure of wave *ii* is suggesting that perhaps all of wave *ii* is complete at the 1267.90 low, and in this case we should expect gold to start to move sharply higher in wave *iii*.

The other option is that wave $c$ is becoming diagonal triangle, and in this case we should expect one more dip below the 1267.90 low to complete all of wave $c$ and *ii*. The market should confirm one of these outcomes early this week.

Once wave *ii* ends we will update our first projection for the end of wave *iii*. Our first projection for the end of wave .iii. is:

.iii. = 1.618.i. = 1447.20, but we have higher projections also.

Longer term, our first and second projections for the end of wave -iii-, as shown on the weekly chart, are:

-iii-=1.618-i-=1661.80;

-iii-=2.618-i-=1993.70.

Here’s a look at gold from our daily chart perspective:

As noted, gold’s price correction may be over now, but here we highlight in more detail our analysis that suggests the correction may not end until gold trades in the $1258 or $1236 area. Investors need to be patient!

Trading Recommendation: Long gold. Use puts as stops.

Active Positions: We are long, with puts as stops!

S&P500

The SP500 was higher this past week, as we expected. It reached a new all-time new high on Friday.

We have now satisfied the minimum requirements for a completed wave V at the 2339.88 high, and we are waiting for confirmation that it is complete.

We may have another couple of small subdivisions to the upside before all of wave V ends. The bottom line:

Our wave counts suggest we are approaching a major top in the SP500!

Active Positions: Very short with put options as our stop!

Crude Oil

Crude was higher early this past week as we reached a high of 66.60, but by the end of the week we had moved sharply lower to reach a low of 62.28.

We had a key weekly reversal lower this past week which is likely our confirmation that all of wave (b) is now complete at the 66.60 high.

We are now moving lower in wave (c), which has a initial target of the 42.36 low, but more likely the 26.05 low. This is shown graphically on our weekly crude oil chart.

Note how similar the oil market has been since the fall of 2018 to the US stock market. President Trump’s negative comments about oil are in sync with our wave counts and a hard fall in oil could see the stock market start to tumble too!

We added to our oil market short positions this week!

Active Positions: Short crude with 60.00 call options as a stop!

Free Offer For Gold-Eagle Readers: Please send me an Email to admin@captainewave.com and I’ll send you our Wave Counts Tactics report! We include key wave counts for silver and updated 60minute chart counts for GDX with to help investors make money!

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